Business & Economy - Employing Staff in Spain

Most businesses will at some point in their growth need to employ staff. Unfortunately, doing so in Spain is complicated by very strict labour laws and regulations, so it's important to be fully informed and confirm with your payroll adviser before taking this step.

To help new employers-to-be, here is a summary of the key areas you need to understand before recruiting.

Types of contract

Employers need to select the correct type of contract from the various types available, depending on the industry and profile of the employee. In the main, the employer will have to choose between offering a temporary or a permanent contract.

A new employee will often start work on a temporary contract and then move to a permanent contract once the temporary period is over. This practice gives both employee and employer most flexibility and is therefore common place. Please note, a temporary contract can only be renewed once; therefore the second renewal needs to be into a permanent contract.

Both temporary and permanent contracts include a trial period. The length of this trial period will depend on the industry, the profile of the employee and the contract type, but it allows employers to terminate the contract if the employee is deemed unsuitable for the position within this time.

On the first day of employment, the employee should be presented with a formal contract of employment. This contract must be signed by both parties and registered with the authorities within the required time period.

Please note that not following this process could result in considerable fines for the employer. There could be a labour inspection at any time and if there are employees working in your premises who do not have the correct paperwork, you will be penalised.

Conditions and minimum wage

Before defining the employment conditions and salary in a contract, consult the "Convenios Colectivos" for your industry sector. These outline the employment conditions and minimum wage restrictions for each class of employee as well as generally for the industry. These are comprehensive documents including everything from minimum wage for each class of employee to holiday entitlement and disciplinary procedures. If your employment contracts do not meet the rules set out by these guidelines, you could be penalized should any of your staff members choose to complain.